Comprehensive state and local tax services

KOM’s extensive industry and technical experience allows us to identify a variety of opportunities to recover overpaid tax. We have obtained hundreds of millions in refunds for our clients. We have identified a long list of refund opportunities and vendors who consistently make mistakes. Our mix of legal and accounting backgrounds allows us to quickly spot issues, minimize disruption to your business, and achieve better outcomes. We represent our clients at every step of the administrative journey, advising you not only on the technical details, but also on how to navigate the processes and personalities involved to get better results faster.

Examples

$100M real estate brokerage company

$200M VoIP telecommunications company

During a tax audit, knowing what to expect and how to respond can save taxpayers a lot of time and money. Many audits derail if taxpayers respond to overly broad information requests, provide conflicting information, or misunderstand an auditor’s question. Significant effort is then required to redirect the conversation or reverse a decision made based on a misunderstanding. We have a very strong and positive working relationship with the Washington State and local tax administrators. Our deep understanding of government organizations, people, and procedures allows us to bring great value to our clients giving them the best chance to avoid, minimize, or eliminate assessments.

KOM Consulting excels at all stages of the audit process including:

Examples

$10B wholesaler

Discovered an accounting error that led to a $150K Seattle BLT assessment reduction

$500M food importer

Discovery of miscoded sales and an unclaimed import exemption led to over $150K in savings.

We can help you identify and manage both known and less obvious state and local tax filing requirements. Historically, companies had to have a physical presence or “nexus,” with a state or local jurisdiction, either permanent or transitory, to create a filing obligation. Now, most state and some local jurisdictions require tax filings based on “economic nexus.”  Numerous court cases, including South Dakota v. Wayfair, Inc. now conclude that a business only needs to make a sale or a certain level of sales to trigger a filing obligation. With 50 states, plus DC, over 3,000 counties, and 36,000 cities and towns it is extremely difficult to comply. To complicate matters even further, the nexus rules differ between tax types and jurisdictions. KOM knows these rules and can tell you what you owe. Staying on top of tax risk will help minimize surprises and is especially important if there is a plan to sell the business. Proactive participation in voluntary disclosure programs can significantly reduce these risks, making an existential problem manageable.

Examples

$50M training & education company

Found over $4M of tax exposure related to multi-state sales and income tax and initiated voluntary disclosures to significantly reduce the risk.

$10M e-commerce company

Identified $500K of sales tax exposure and  also found $400K of refunds to offset the tax risk.

After the South Dakota v. Wayfair, Inc  decision, many businesses’ tax footprint increased significantly, even if their business had not changed. Many businesses lack in-house tax expertise, can’t easily integrate all their billing systems with existing sales tax software, or don’t want to manage the sales\use and excise tax compliance process. KOM Consulting can prepare your multi-state sales, use, excise, B&O, and personal property tax returns to help you focus your time on more strategic business and other tax matters. We are skilled in Vertex Indirect Tax Returns® software to prepare returns and can process client data from multiple sources. Our service is comprehensive and results-oriented. Unlike the automated filing solutions offered by the big tax software companies, KOM offers personalized services with accountable, problem-solving experts rather than a 1-800 help line.

Services include:

Examples

$50M e-commerce company

File 340 sales\use, excise and personal property tax returns

$80M UK-based hardware & software company

File 85 sales\use and excise tax returns

In an ever-changing, post-Wayfair tax landscape, many companies have found themselves out of compliance. We can help identify material tax gaps and minimize past period tax risk. Many tax jurisdictions offer voluntary disclosure or amnesty programs, which offer opportunities to eliminate past period taxes, penalties, and sometimes even interest. As a bonus, most states simply accept these submissions in spreadsheet format and rarely, if ever, audit them. We can help you evaluate the facts and filing requirements, consider filing positions, facilitate agreements, and submit the tax returns and payments. In some cases, we will recommend clients attempt to recover uncollected sales tax from customers to help offset the unpaid liability or contact their customer to see if they have already self-assessed the tax.

Examples

$10M non-profit industry self-insurance fund

Quantified and disclosed a B&O tax liability saving over $150K in taxes, penalties, and interest.

Appeals

When an issue cannot be resolved during the audit/letter ruling process, an appeal may be justified. We can help evaluate the cost/benefit and likelihood of success. We prepare and submit petitions, draft briefs, and attend administrative hearings. Many of our administrative appeals are resolved at the agency level, especially in cases where we take the lead to negotiate a compromise. We can also provide litigation support to your legal team for controversies involving Washington State and local jurisdictions.

Rulings

In the past ten years, there have been many changes in state and local tax law creating doubt and uncertainty, giving rise to conflicting opinions, and/or leaving room for interpretation. To address this risk, we can prepare and submit ruling requests to state and local agencies. Rulings provide a high level of certainty and are binding on the taxing authority. As such, they can be a valuable asset, particularly when there is a significant amount of money at stake.

Legislative & Regulatory Support

During a Washington State legislative session, hundreds of tax bills may be submitted to the Legislature for consideration. Many eventually obtain sponsors and some become law – many with limited public visibility. Additionally, there is local tax legislation which can be even less transparent, and laws can pass with little stakeholder input and in very short time frames. We can assist clients (including industry associations) by monitoring relevant tax legislation at the state and local level, attending public meetings, and testifying as needed. Once legislation is passed, tax rules are often drafted, and public meetings occur. We can attend these hearings, draft written comments to proposed rules, and keep you informed on how any changes may impact your business or industry.

Tax Research & Planning

Whether you just need to know if fish is considered a perishable meat product (This was a real tax dispute!) or need to evaluate the tax impact of a corporate reorganization, KOM can help. We know where to find authoritative and current sources of information. When a corporate reorganization is involved, we can model the tax effect of these changes and evaluate planning ideas to minimize the tax costs. When research identifies ambiguity, we know who to call at the Department of Revenue. This information can provide great insight and is invaluable for managing risk. Additionally, if a tax matter involves a state, other than Washington, KOM is member of the Independent SALT Alliance (ISA) which gives us access top-tier experts in nearly every state.